Speaker Joe Straus, shown taking the oath as the House's leader on Jan. 13, next to his wife Julie.

Speaker Joe Straus has made long-time budget writer Rep. John Otto the chairman of the powerful House Appropriations Committee.

Otto, R-Dayton, is an accountant and property-tax expert who has been the chamber’s lead school-budget writer in past sessions. He will succeed former Rep. Jim Pitts, R-Waxahachie, who retired.

Straus dispensed consolation prizes to Otto’s two rivals for the Appropriations chairmanship. He elevated Rep. John Zerwas, R-Richmond, to be head of the Higher Education Committee. Last session, it was run by former Rep. Dan Branch, R-Dallas. And Straus gave the Energy Resources chairmanship to Rep. Drew Darby, R-San Angelo.

2005 AP Photo/Deborah Cannon

Rep. John Otto

Straus, R-San Antonio, made the selections as he exercised one of his position’s greatest powers — assigning all 150 House members to the committees that take a first look at legislation.

“With these assignments, I have placed members where I believe they can have the greatest impact on issues that directly relate to our economy and our future,” Straus said in a statement.

Some of Straus’ top lieutenants kept their powerful posts from last session — such as Fort Worth Rep. Charlie Geren at House Administration, Corsicana Rep. Byron Cook at State Affairs and Corpus Christi Rep. Todd Hunter at Calendars, which serves as traffic cop for bills heading to the House floor.

Straus named veteran Rep. Dennis Bonnen, R-Angleton, to run the tax-writing Ways & Means Committee. With tax cuts on the agenda, that could be a crucial pick. Former Chairman Harvey Hilderbran, R-Kerrville, left to run unsuccessfully for state comptroller.

Straus restored a Democrat, El Paso Rep. Joe Pickett, to the helm of the Transportation Committee. Former Transportation chief Rep. Larry Phillips, R-Sherman, is the new head of Homeland Security & Public Safety.

You can read Straus’ statement and look at the assignments by clicking here.

Lawmakers on Tuesday questioned the unusual way in which Gov. Rick Perry scrounged for cash recently to pay for deploying the National Guard to the Texas-Mexico border.

Instead of asking the Legislative Budget Board to sign off on a “budget execution” transfer of money, Perry invoked a 1993 law to certify an emergency exists because an influx of unaccompanied child migrants from Central America.

Perry, who has said federal border guards are so distracted they can’t deter illegal entries by criminals and even terrorists, has diverted $38.7 million from a Department of Public Safety fund that’s been piling up court-case fees for an expected future state purchase of radio equipment for emergency responders.

The Legislature hasn’t yet given a green light for purchase of the “inter-operable” equipment, which made the money a tempting place for a quick pinch, budget experts said.

Members of the 10-member budget oversight board, which held its annually required meeting Tuesday, though, said they want the radio equipment money replenished.

Several questioned why Perry didn’t ask for their usual approval of proposed money maneuvers when the Legislature is not in session.

Perry could have dipped into his own office’s disaster relief account, which currently holds $63.3 million, said Republican Reps. Drew Darby of San Angelo and John Zerwas of Richmond.

Lt. Gov. David Dewhurst, who has supported Perry’s deployment of 1,000 Guard personnel, said he wasn’t thrilled by the method used to foot the tab.

“I would’ve preferred to have gone in almost immediately, right after the activation of the National Guard, and addressed this issue immediately” with a budget execution vote by the board, Dewhurst told reporters. “But apparently the governor’s office felt that was going to take longer.”

The $38.7 million from the radio fund and the use of $3.5 million in federal criminal-justice funds will repay DPS for its stepped-up activity at the border and pay for National Guard costs for two to three months, Dewhurst said.

But he warned that the money will be exhausted by early October. The budget board and Perry’s office will have to look elsewhere in the state budget if they want to extend the Guard’s deployment beyond 90 days, Dewhurst said.

Nelson said, though, that it’s unfair for state taxpayers to bear a cost caused by federal failures in immigration enforcement.

“I sure would like for them [federal officials] to foot the bill so we can spend it on education, water and highways,” she told reporters.

2007 AP Photo/Harry Cabluck

Mike Morrissey, right, Gov. Rick Perry's longtime guru on the state budget, said Tuesday that concern about hurricanes prompted Perry to look beyond his disaster fund for money to pay for National Guard troops at the Mexico border.

House Republicans who sit on the board were more critical of Perry’s emergency declaration, which only involved sending papers back and forth to Comptroller Susan Combs over two business days last week.

“We couldn’t have dealt with this in a budget execution kind of activity?” Zerwas asked Mike Morrissey, Perry’s deputy chief of staff and senior adviser.

Morrissey predicted there will be calls on the $63 million disaster fund Perry controls. He mentioned hurricanes, wildfires and possible disasters such as last year’s deadly explosion at a fertilizer plant in West.

“We are absolutely willing to use some of that money for this purpose,” he said.

He added, “The timing of trying to do budget execution at this meeting was a problem.”

Rep. Sylvester Turner, a Houston Democrat who’s been a top budget writer for more than a decade, said he fears Perry has set a bad precedent. Bypassing the requirement that lawmakers approve a fund shift could embolden future governors, he said.

“The next governor … can declare almost any situation an emergency and then tap funds,” Turner said.
Morrissey, though, said that with 1,100 undocumented immigrants being apprehended each day in South Texas in recent weeks, Perry had to act decisively.

He promised the governor’s office will work with lawmakers in coming weeks to identify unused state money that can be tapped to pay for extended use of the National Guard.

The Senate on Tuesday finally passed and returned to the House a dedicated-taxes bill that would advance Sen. Tommy Williams’ plan to refund $630 million of electricity-bill fees collected to help poor people but never used for that purpose.

The System Benefit Fund was created by Texas’ 1999 electricity-deregulation law. It has become a political football, as lawmakers for the past decade have hoarded much of the money, to help them spend more on other programs.

It’s also a key point of contention as House and Senate leaders seek to finalize their deal on the two-year state budget and related money bills.

The fund contains about $830 million in unspent money. As passed by the House, Rep. Drew Darby’s bill overhauling various dedicated taxes would have spent down the balance of the System Benefit Fund over 10 years. The money would have been used to weatherize the homes of low-income ratepayers in affected areas, as well as give them discounts on their power bills. The fee, reduced to 52 cents per megawatt hour from 65 cents currently, would go away at the end of the 10-year period.

But Williams, R-The Woodlands, has insisted on a much different approach to getting rid of the fund’s huge unspent balance: rebates.

He wants $630 million of the unspent balance to be refunded to ratepayers in “competitive areas” — those where consumers and businesses have a choice of electric retailers.

The Texas House on Wednesday tentatively approved two bills that would roll back lawmakers’ reliance on dedicated funds to balance the budget.

One would cap at $4 billion the amount of dedicated taxes that budget writers could hoard. Since 1991, the Legislature has forced the state comptroller to count the unspent balances in dedicated accounts as if the money were general-purpose state revenue available to finance the two-year state budget.

Rep. John Otto, R-Dayton, said Comptroller Susan Combs expects the unused, special-purpose funds to grow to $5.3 billion in 2014-2015 — even more than the $5 billion lawmakers left unspent last session.

Since 2003, legislators have feuded over hoarding of money in dedicated accounts where the state accumulates money for a stated purpose, such as electricity discounts for the poor or subsidies for low-income motorists to repair or replace their smoke-belching vehicles.

Courtesy

Rep. Drew Darby, R-San Angelo

Typically, Democrats complain that GOP leaders have spurned poor people or good causes. But Gov. Rick Perry also has beaten up fellow Republicans who write the budget for not keeping faith with taxpayers.

Since 2005, Perry has called for “truth in taxation” and urged lawmakers either to repeal or use the dedicated taxes. That’s irritated GOP legislative leaders, who’ve struggled to fund universities, public schools, roads and other popular programs without raising taxes. But after the state economy rebounded strongly from the Great Recession, leaders last year promised to review and possibly curb their use of accounting gimmicks in budget-writing.

In particular, Speaker Joe Straus, R-San Antonio, vowed to begin weaning lawmakers off their reliance on unspent, dedicated tax revenues. Two of his lieutenants — Otto and Rep. Drew Darby, R-San Angelo — crafted the two bills that would do that.

Otto acknowledged that this year, lawmakers aren’t going cold turkey and setting loose all of the dedicated-tax money. But a 20-percent reduction of the hoarding — to $4 billion, from $5 billion last time — is a good start, he said.

“I call this stopping the bleeding,” he said. Otto said his bill would give the Legislature time to weigh further measures to reduce reliance on the funds.

Two Democratic House budget writers complained Tuesday that a $6 air pollution clean up charge added to annual car inspection fees in North Texas, metro Houston and metro Austin continues to be hoarded, a practice they say GOP state leaders deplore but are moving very, very slowly to change.

At a House Appropriations meeting early Tuesday, Reps. Helen Giddings, D-Dallas, and Sylvester Turner, D-Houston, protested a plan to spend only $5.6 million a year from the dedicated-revenue stream in the next two-year budget cycle to help low-income motorists repair or replace smoke-belching vehicles.

According to a budget staff member’s testimony, the fund will have a balance of about $77 million in unspent money as of Aug. 31. In addition, about $40 million is expected to be collected in the affected 16 counties in each of the next two years.

Oil and gas drilling is so hot in Texas, and a permitting delay of even one day so costly, that energy chieftains have blessed a budget maneuver under which they’ll keep paying a host of fees so the state can buy about $22 million worth of computer hardware and software for the Railroad Commission.

Rep. Drew Darby, the House’s chief budget writer for natural resources agencies, said Tuesday the deal is necessary to try to shave 12 hours off the turnaround time on permit applications. Currently, it takes the commission an average of 84 hours after an application is submitted to give an answer, said Darby, R-San Angelo.

“They have green-screen monitors and DOS [Disk Operating System] programs,” he said of commission employees and their outdated computers. “During the day, they have to shut down public access” to commission databases “so as to allow staff to access their computer system. It is incapable of keeping up with the ordinary workload of a growing industry.”

DOS (Disk Operating System) Computer

The House Appropriations Committee tentatively approved a recommendation by Darby’s subcommittee to add $21.75 million to a supplemental spending bill.

The bill is being drafted to cover agencies’ losses and costs of fighting the 2011 wildfires and some other unforeseen expenses.

Darby said it would free up unused fee money at the Railroad Commission, allowing the agency immediately to begin purchasing new information technology equipment and start hiring 11 new employees for the conversion to a web-based system.

The fees, which you can review here, go into an account used for oilfield cleanup. Darby said the fund is capped and the balance was nearing the cap. But industry officials are happy to keep paying the fees, he said.

“You pay now or you pay later,” he said, noting that even a delay of just one day in a production company’s schedule can be very costly.